How to Write a Car Wash and Detailing Business Plan or Template
The carwash and car detailing industries have been expanding service offerings, which has led to an influx of competitors in the industry. This influx has also spurred the demand for carwash business plans, car wash business plan templates, and carwash proforma financial projections.
As a child, a great way to make money was washing cars. This practice inevitably led to me starting one of my first businesses, which was a car detailing service. Today, several years later, the car wash and car detailing industry is still running strong. There is a multitude of reasons for this based on our business plan writer's research. First, starting a car detailing business is relatively inexpensive. For the most part, car detailers need a waxer, an assortment of cleaners, and a shop vac. With this basic foundation, our business plan writer has found that most entrepreneurs are able to develop a loyal customer following. As their business grows, then more sophisticated equipment and techniques may be incorporated to the point where a standalone carwash/detail shop is necessitated. Further, in reference to a carwash, our business plan writer has found that once a carwash is established, not only are profits often above average, but membership sales expand revenue-generating opportunities.
Because of these reasons, car detailers and carwash companies have been growing moderately. However, starting and operating a car detail company or carwash without a business plan is ill-advised. From this, or business plan writer has come up with some tips and tricks for writing a car detail business plan as well as a carwash business plan (11/21).
Executive Summary for a Car Wash and Detailing Business Plan and Template.
The executive summary section for the car washing car detailing business plan should start out similar to other business plans. Specifically, make sure to include the carwash company’s name, location, business owners, and whether the carwash will be a hand wash or automated. Further, our carwash business plan writer also recommends the business owners in this industry briefly discuss whether the carwash or car detailing business will be a niche service provider or a generalist. What we mean by this is that some carwashes specialize in providing automated carwash services only. Other carwash businesses will pretty much wash any vehicle with four wheels. By differentiating and discussing your business model in the executive summary, carwash business owners are able to set the readers’ expectations as to how the various components of the organization will be interwoven to increase the likelihood of synergy (3/22).
The company information section of the carwash and car detailing business plan should start off by describing the need for a carwash in the area. Common needs would include lack of competition in the area or poor service provided by area competitors. Once the foundation is that, then providing significant details in relation to the location should be done. Common factors that may be included in this type of location section would be traffic on a major thoroughfare, population density, and scarcity of competition. Finally, to round out the section, make sure to include a future service section as well. Most carwashes have typical services such as express washes, hand washes, etc. By exploring new, differentiated services, the business owner is able to set the stage for future differentiation.
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Service Description and Competitive Advantages
The service description and competitive advantage section of a carwash and car detailed business plan should include common services that customers have come to expect from a carwash and car detailing service. These common services may include express washes, interior and exterior cleaning, and bumper-to-bumper hand detailing activities. Further, carwash and car detailing entrepreneurs should also explore new services not offered by other competitors. These services may include car pickup and drop-off as well as a mobile carwash service component. Even if these services are not huge profit centers, the differentiating factor helps set the company apart.
The target market section for this type of business plan or template is typically area residents within a 5 to 10-mile radius. However, creative carwash entrepreneurs often extend their target market to include employees working for large businesses in the area and even tourists using major thoroughfares in the area. By applying some creativity to the target market, business owners are able to expand their appeal to other demographics and subsequently generate additional revenue.
In addition, to help exploit target markets, business owners may use advertising tactics such as discount cards or employee discounts. Employee discounts may be offered by visiting small businesses in your area. During these visits, carwash business owners are able to offer discounts for carwashes to area employees. By following this practice, not only are small business owners increasing the likelihood of carwash visitors, but they're also taking advantage of building brand recognition through the use of fully understanding the target market in their area.
Industry research for a Car Wash and Detailing Business Plan
Industry research for the carwash and car detailing business plan section should start with examining what competitors in the industry do and then review national statistics related to carwashes and car detailing businesses. For example, carwash competitors provide car washing car detailing services such as cleaning, washing, and waxing automobiles such as cars, trucks, and even RVs. Industry competitors include small one-person car detailing services as well as self-service carwashes. Revenues for this industry in the last 12 months were approximately $11 billion. The growth rate for carwash and car detailing service revenues was about .6% for the last five years annually. Industry competitors, collectively, exceeded $1 billion in profits. However, profit margins have been decreasing by approximately 7% annually for the last several years. An important weakness in the industry is its high competition and relatively low cost to start a carwash in business.
By providing industry statistics and other information about the carwash and car detailing industry, business owners are able to first set the foundation that they are an expert in the industry. Next, it also shows that business owners are well-versed in industry happenings.
The owner and management section of a carwash and car detailing business plan should start with discussing professional experience related to the carwash industry. If carwash industry expertise is not an option, then explore managerial positions such as supervisor, manager, or shift leader. Management expertise, in general, is transferable across industries. Next, support professional experiences with any and all educational or extra-curricular activities. An example of this will be if the future business owner has a management degree or has volunteered in the local community. By intertwining education and professional experiences, business owners are able to usually make up ground for a lack of industry-related experiences.
Funding Request for a Car Wash and Detailing Business Plan or Template
The funding request section for a carwash and car detailing business plan should start off by explicitly stating how much money will be needed to start or purchase the business. Common equipment needed for a carwash and car detailing business would be vacuums, hoses, cleaning material, and sponges/towels. For a larger operation, land purchase or lease, as well as buildout information, should be included in the section. Keep in mind, that when creating the funding request section, make sure to leave wiggle room for funding. To illustrate, if a vacuum costs $1500, then add 10 to 15% to this price. By adding buffers to prices, business owners are able to have flexibility in selecting models as well as choosing new or used equipment.
The financials and financial projections section of a carwash and car detailing business plan should start with daily sales. Some financial projection models for carwashes will break out each service offered, average the sales price, and then project the number of customers choosing this product on a daily basis. Other financial models will estimate the number of customers visiting the location and the average ticket sale per customer. No matter which financial modeling structure is embraced, make sure to include justification for using it in the assumption section of the business plan. Further, make sure to provide details showing growth rates and how various costs are aligned with revenue flows. By far, the financial section of a carwash and car detailing business plan should be the most difficult. However, with a well-structured financial section, the perceived risk of investing in this type of business may be substantially mitigated.
Hopefully, these insightful tips and tricks for writing a business plan were helpful. As always, if you need help with a business plan or financial projections, just send us an email or give us a call.
Author: Paul Borosky, Doctoral Candidate, MBA., Author